Small Business Loans & SBA Loans in Louisiana

Louisiana, known as the Pelican State or the Bayou State, has a broad-based economy that offers numerous opportunities for small business owners to start up new companies and grow existing ones. The state has plenty of local bankers and financiers who are familiar with community businesses and know how to arrange the best financing options for businesses to grow or add new jobs.

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Types of Louisiana Small Business Loans

Lenders in the Bayou State have learned over the years how to arrange financing options for small businesses engaged in agriculture, oil refining support, chemical manufacturing, and commercial fishing. Business owners know they can go to their local banks and find the short- and long-term financing that they need.

SBA loans

SBA loans are business loans that are partially backed by the Small Business Administration (SBA), a federal agency. These loans are serviced by private lenders, but are popular because they generally have good interest rates.

Line of credit

Use a line of credit as a flexible form of financing. Unlike with a loan, this option does not involve a big disbursement upfront that you must repay, providing a flexibility that better fits many entrepreneurs’ needs.

Term loan

Term loans are common small business loans in which you would apply for a large disbursement of capital and then repays it over several years, along with fixed or variable interest.

Equipment finance

With equipment financing, you receive a piece of equipment and then pay off the cost of the equipment in installments. This way, your business can make money off the equipment immediately, even if you don’t have the funds to buy it at the sticker price.

Accounts receivable financing

Accounts receivable financing is an alternative form of business financing in which your unpaid invoices serve as collateral for a lump disbursement of funds.

Louisiana Small Business Loan Options

The Bayou State has an abundance of bankers, credit unions, and nonprofit organizations that are eager to make loans to small businesses and encourage economic development in their community.

Based in New Orleans, Fidelity Bank offers lines of credit, equipment loans, term loans, and commercial real estate loans, and is a leading lender for SBA Loans in Louisiana.

Louisiana Economic Development facilitates small business access to loans and capital by guaranteeing loans made by banks and other lenders.

TruFund offers financing for small businesses that have difficulty getting approved through traditional lending sources.

LiftFund provides financing to small business owners with funds contributed by interested individuals and businesses who want to improve the economic conditions in their community by creating new businesses and jobs.

Pelican State Credit Union offers equipment and real estate loans, business lines of credit, and is a lender for SBA 7(a) Loans in Louisiana.

Hope Credit Union offers three small business loan programs for entrepreneurs, including the Hope Small Business Loan Program, the SBA Community Advantage Loan Program, and the Diverse Community Capital Program.

Restore Louisiana’s Small Business Loan Program aids in the recovery of disaster-impacted small businesses who were affected by Hurricanes Laura, Delta, Ida, and/or the May 2021 Severe Storms.

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FAQ about Small Business Loans in Louisiana

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FAQs

What other resources are available to Louisiana small businesses?

The Bayou State has other organizations to assist small businesses with more than just financing and raising capital.

The Louisiana Small Business Development Center offers business training, seminars, and connections to resources for financing small businesses. SCORE is a nonprofit organization made up of retired business executives who stand ready to provide mentoring and advice to small business owners.

What Louisiana small business grants are available?

Several organizations in Louisiana offer grants to encourage the development of small businesses.

For example, GrantWatch keeps a database of grants currently available to small businesses in Louisiana. WomensNet sponsors the Amber Grant program to provide grants to women entrepreneurs who want to start their own small businesses. The Small Business Innovation Research (SBIR) program managed by the SBA offers funding for entrepreneurs to conduct research that will eventually lead to commercialization of their vision.

What do I need to qualify for a loan in Louisiana?

Before applying for a loan, you’ll need to decide on how to structure your business. It could be either a sole proprietorship, a corporation, or a limited liability company (LLC). If you’re going to operate as a sole proprietor, you’ll only need to record the name of the business with the county. But if you’re going to incorporate or become an LLC, you’ll need to register the name with the Louisiana Secretary of State.

The next step is to find out what documentation the lender requires. Generally, most lenders will want to see a business plan, cash flow projections, description of the collateral being offered to secure the loan, and a clear plan on how you intend to pay the loan back. The lender wants to feel comfortable that you have established a valid purpose and need for the loan, that it will be beneficial to your business, and that the lender will not be taking on any unusual risk.

Which loan is right for my Louisiana business?

The right type of loan depends on what the funds are being used for. If you intend to use the loan to buy a piece of equipment, then a long-term loan with payments over several years is the best choice. If you’re going to use the funds to support inventory and accounts receivable, then a short-term loan or a revolving line of credit is the way to go. Online platforms, such as Lendio, have analysts who can discuss your financing needs and recommend a solution.

How can a Louisiana business loan help my business?

Businesses need more than just equity capital to start up and grow. From time to time in their development, small businesses need to borrow money, either on a short-term or long-term basis. Having an established relationship with a banker or other lender is important for a business to have access to debt financing when it’s needed to support its growth.

What is an SBA preferred lender?

An SBA preferred lender is a lender that’s been approved by the Small Business Administration to administer SBA loans without additional approvals from the SBA. Typically these lenders have years of experience and can approve SBA loans faster than non-preferred lenders.

What are the benefits of an SBA loan?

SBA loans are backed by the government and offer lower interest rates than other types of small business loans. They typically require a minimum time in business of two years and a credit score of 650+.

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